John Wooner speaks to the council on the City of Fillmore’s 2009-2010 Budget.

On August 11, 2009, Fillmore City Council held its third Budget Workshop as part of the development of a 2009-2010 budget. The Council plans to adopt the final budget after a formal public hearing on August 25th. At the previous workshops, on July 23rd and 28th, Transitional City Manager Larry Pennell expressed concerns that the City would suffer a financial crisis in the middle of the 2010-2011 fiscal year if spending were not curbed to match projected decreases in revenue. The Council directed staff and John Wooner, a consultant who had been hired to help with budget preparation, to incorporate suggested cuts and other recommendations into the budget. The budget was revised on August 10th. After a general overview of the changes, the Council reviewed the budget funds almost page-by-page, asking questions, making corrections, and requesting changes. Wooner hopes to receive the last of the Council's change requests by August 14th, so that he will have time to incorporate the changes into the final budget to be presented on August 25th.

Wooner had been hired, on Pennell's recommendation, to reformat the budget. On July 23rd, Wooner presented the Budget in a new format as a series of Microsoft Excel spreadsheets. The formatting changes to the budget do not indicate a shift in accounting practices, but are expected to make the budget more transparent to increase its usefulness as a management tool. The new format is expected to provide City employees, Council members, and the public with a budget that is easier to read, analyze, and manage. The Council will be able to see spending patterns on a monthly basis. The previous budget format was more line-item oriented, and items were identified by fund and divisions within each fund. The new format shows a summary page, detail page, and salaries page for each fund. The August 10th version of the 2009-2010 budget will be available for download in pdf form at www.fillmoreca.com

Pennell said that the latest draft of the budget included significant spending cuts and revenue enhancements. Staff confirmed the availability and viability of $435,000 in vehicle license fees (not previously projected to be that high) and an additional $750,000 in tax revenues. Wooner explained the City was "definitely not overspending", but expected a shortfall due to reduced funds from the State and reduced revenue from property taxes, sales taxes, and motor vehicle taxes. Wooner indicated that the Council-approved cuts in unnecessary expenditures will make balancing next year's budget easier.

One major change in the formatting was the separation of the RDA budget from the City budget. The City relies extensively on RDA money. On July 23rd, Pennell noted that RDA money cannot and should not carry the City. Previously, the RDA money was shown throughout the City's budget. Now the RDA is shown as a separate sub-budget with its own funds, and transfers track the distribution of RDA money into various City funds. When asked, Wooner said that Fillmore's reliance on RDA money is not unusual. The redevelopment Agency (RDA) receives a significant amount of its funds from property taxes.

The August 10th revision of the 2009-2010 budget, including the RDA budget, shows revenues of approximately $48 million ($7 million from RDA funds) and expenditures of approximately $68 million (almost $11 million from RDA funds). Wooner explained that $14 million of the difference is from the sewer construction project, and that those costs had been covered in previous years. Thus, the relevant funds show a positive cash balance. For accounting reasons, the coverage of the $14 million cannot be shown in this year's budget, according to Wooner. Wooner said that Council policy requires that an amount equivalent to 40% of the year's expenditures should be set aside for emergency reserves. Wooner explained that the budget shows those reserves distributed among several funds, but the Council has not declared any emergencies and the Council and staff intend to maintain the emergency reserve, not spend it, at this point. The budget is expected to undergo revisions as the impacts of State decisions are absorbed.

Only three of the budget funds have negative balances, and the City has no negative cash balances. The Town Theater fund shows a projected loss of $347,792, the Development Impact Fees (DIF) – Public Facilities fund shows a projected loss of $18,446, and the DIF – Transportation fund shows a projected loss of $8,499. Wooner noted that the DIF funds will replenish themselves as development occurs and fees are assessed. In the course of the August 11th discussion, Deputy City Manager Bill Bartels informed the Council of the City's newest efforts to make the theater profitable. The City has been conferring with the Ventura County Arts Council.

Wooner has developed the 2009-2010 budget based on numbers provided by City staff, and suggestions from staff and the Council. The columns comparing previous years' budgets are using budgetary rather than actual numbers, but actual numbers will eventually be gathered by staff and inserted there. At the latest workshop, the Council requested a summary of salaries and benefits, which are currently broken down by fund. Wooner explained that he did not have access to the exact cost of employee benefits, but that he was using estimates, and the exact numbers would be filled in later by City staff.

The City has 42 part-time employees and 43 full-time employees. The budget includes Memorandum of Understanding increases to City employees' salaries, but does not include salary adjustments for mid-management or management level employees. The budget provides for the addition of 4 more full-time employees: one pool maintenance worker and three paramedics/engineers for the fire department. At the July 28th Budget Workshop, Fire Chief Rigo Landeros informed the Council that he needed three permanent full-time paramedics who could double as engineers to drive fire trucks. Landeros noted that the fire station is sometimes understaffed. He explained that the economy has reduced volunteer availability, as volunteers take second jobs. On Sunday July 19th, firefighters were called to a stump fire. There were only two firefighters on duty at that time. Landeros explained that at structural fires, firefighters cannot enter the building unless four firefighters are present: two to go in and two to remain outside. He also mentioned that 85% of calls are for emergency medical services. According to Landeros, the three new employees would provide one additional person per shift, and no more additional employees would be needed over the next five to eight years. According to the new budget, the paramedics/engineers will start work in January 2010.

After negotiation with the School District (FUSD), the City has agreed that FUSD will pay $75,000 towards the School Resource Officer (SRO) and the City will pay the balance not covered by the Sheriff's department. According to the City, FUSD had wanted to pay only $50,000 (half of the $100,000 it paid in previous years) but the City was able to convince them to pay $75,000. Pennell mentioned that the City would contribute landscaping as part of the negotiated arrangement. According to Patti Walker, the City expects to pay less than $70,000 toward the SRO.

The budget includes Granicus software, which Pennell is recommending to provide public and staff access to automatically indexed City meetings and documents. The Council has not seen the software, and is allowing it as a budget item just in case it decides to purchase the software. City staff has seen a sales presentation, and was impressed by the software, but the Council is reserving judgment.